Interactive Brokers (IB )’s comprehensive offering makes it easy to access over 100 market centers in 24 different countries that trade stocks, forex, futures, options, ETFs, bonds and CFDs. This Interactive Brokers Canada review looks at your entire package including trading fees, your webtrader platform, mobile applications, customer service and more.
Minimum deposit amount
Once you have downloaded an account and received your login details, you’ll have to top up your account before you can start trading. Individual Accounts, Trading Group Masters, and Broker Masters all require a $ 10,000 deposit.
Overall, this minimum price is above the industry standard. As a result, beginners with limited personal capital may be put off. There are other brokers who work under Interactive Brokers, they require a lower minimum deposit and send the order flow directly to IB. The trading fees are higher because the lower broker also wants to form money.
Regulation & license
Before you fund a trading account for the first time, it’s important that you confirm that the broker is properly regulated. This can protect your capital in a number of scenarios as your broker is required to stick to certain rules and regulations.
That being said, IBKR LLC is regulated by the Securities and Exchange Commission, the Financial Industry regulatory agency, the New York stock exchange, and also the Financial Conduct Authority. It’s also overseen by variety of other regulatory agencies around the world. Customers in Europe trade under the FCA license.
Spreads & Commissions
In terms of cost review, forex spreads and other such fees at Interactive are competitive. This can be because many of the brand’s customers are professional dealers and institutions. Hence, providing low commission rates is important.
You can expect a low, fixed commission rate of $ 0.005 with a minimum of $ 1.00 on all products and comparable rates. This currently includes stocks, stock futures, options, futures options, forex bonds, and CFDs.
Interactive Brokers offers 2 different fee models
Tiered – the higher the trading volume, the cheaper the fees. Discounts are passed on to customers.
Fixed Price – Fixed price commission per share or a fixed percentage of the volume. Exchange and supervisory fees are included.
In general, Interactive Brokers is one among the cheapest brokers in the world. It’s the biggest broker with the best contacts to exchanges and therefore the highest trading volume. The provider can provide you with incredibly cheap fees.
In terms of leverage, IB also ranks high compared to eTrade, Thinkorswim, Tradestation, Oanda, Scottrade and other competitors. In fact, initial margin rates can range from 1.41% to 1.91% for those with accounts over $ 1 million.
Margin trading in futures and options can increase your purchasing power, but it may also increase losses. If not handled with care, these loans can quickly cause traders to lose their entire account balance. For Forex and CFD trading, a leverage of up to 1:30 is accessible according to the EU ESMA regulation. Professional clients can request a higher leverage.
Additional trading costs at Interactive Brokers
There are variety of other costs and costs that you simply should examine before signing up. For instance, accounts with but $ 100,000 must meet a minimum of $ 10 in commissions per month. If not, the corporate will charge the difference. If you’ve got an account with a balance of $ 2,000 or less, you want to pay a minimum trading commission of $ 20.
Fortunately, users who are 25 years of age or under must meet a minimum quote of just $ 3 in monthly trading commissions.
Overall, the minimum trading fees are high for about the most active traders. But although they’re above the industry average, their activity fees remain significantly less than for instance with Lightspeed.
Finally, IB charges an exposure fee for a minority of clients with high risk margins. This compensates for taking care of such risky accounts. The amount of the deductible is calculated using proprietary algorithms and depends on the individual circumstances.
The main draw for many is the Trader Workstation (TWS). It is used to trade a range of instruments, from ETFs and futures products to crypto currencies such as Ethereum. It’s available for Mac, Windows, and Linux users.
Once you finish downloading the workstation, you’ll be given the default Mosaic setup. However, users may also access the Classic TWS, which is that the original version of the platform.
You get all the essential functions. Backtesting and also the setting of trailing stop limits are therefore a part of the quality equipment. The earnings calendar can also be easily accessed.
To make managing the watchlist easy for thus many asset classes, they introduced an easy approach. You merely enter any stock symbol and a summary of the stocks available appears. Your watchlists can then contain a spread of anything. In fact, you’ll have up to 338 different columns. When it comes to customizability, the IB are pioneering with their proprietary platform.
The only downside is that you simply can stray during a long list of real-time prices or stocks. For instance, once you enter AAPL for Apple, you’ve got to dig through variety of possible matches.
The following platforms are offered:
- Client Portal – Portfolio Overview – Trading is possible
- TWS – Traders Work Station professional trading platforms with analysis tools
- IBKR Mobile – Mobile app for each device
- IBot – For text and voice commands
In terms of charting, the platforms do reasonably well. There are 125 different studies available which will be included in any chart. However, TradeStation offers 260 and TD Ameritrade promises 360. Another disadvantage is that there are only eight tools available for markup. You’ve got the fundamentals like trend lines, notes, and Fibonacci, but lack resistance lines and channels.
Still, the charting on the TWS is user-friendly and sufficiently customizable for many traders. Historical trades, alerts and index overlays also are available.
You also have the benefit of an impressive 63 different order types.
In addition, the choices Strategy Laboratory enables you to make and submit simple and sophisticated multiple option orders. Additionally, you’ll compare up to 5 option strategies at the same time. The volatility laboratory and algo trading are all available in the TWS.
The mutual fund / ETD Replicator is additionally worth mentioning. It’ll assist you find cheaper ETF alternatives to mutual funds. All of this is often associated with their approach of providing as many instruments and markets as possible.
IBKR doesn’t actively support the MetaTrader 4 or 5 platforms. As you’ll imagine, they need to encourage the download of their bespoke TWS platform so that you do not get too much help from them integrating your MetaTrader software into their offering. Fortunately, there are some third-party software out there which will help bridge the platforms.
Overall, this trading platform is a good choice for advanced traders. The suite of powerful features, watchlists, and a customizable account dashboard make it an efficient and easy-to-use platform. The risk analysis and also the technical tools complete the excellent offer.
However, beginners may be overwhelmed by the Trader Workstation. Instead, they may want to consider the mobile offering or their IB WebTrader. The latter could be a clean browser trading platform that’s easier to navigate.
IB provides iPhone and Android apps. Your apps also are compatible with tablets. The interface uses key technology, so you’ve got to enter or swipe a PIN as a further security measure. Two-factor login with Touch-ID is supported, but an application with a secondary key’s required rather than just logging in with Touch-ID when loading the particular application.
There are several sorts of accounts available with IB, including:
- Cash Accounts – These can only be used for entering long securities positions, long option positions and covered short positions.
- Margin Accounts – you’ll buy a security on margin. This implies that you simply can sell securities positions, futures positions, and bare options positions.
Portfolio Margin Accounts – These accounts allow you to require an equivalent positions as regular margin accounts. However, they use an alternate method of calculating the margin requirements. Often times, these requirements make sure that users can enjoy greater leverage, but they are doing require a minimum balance of $ 100,000. Additionally, foreign accounts might not be allowed, so international trading with this sort of account is restricted.
Interactive Brokers demo accounts
You also get access to a practice / demo account. This free trial account allows for unlimited simulated trading that does not require you to risk any real capital. Here you’ll familiarize yourself with the markets and develop an efficient strategy. It is also an incredible thanks to try their trading platform.
When your confidence has grown, you’ll then upgrade to a live trading account. All you should to do is follow a couple of basic contact details and therefore the on-screen instructions to download the platform.
The reviews of the demo accounts were very positive. Once signed in, you will have access to a good variety of trading tools and financial instruments, while customizing the interface is quick and straightforward.
Security and Protection
When exchanging, you get a high level of security and protection. This is often a results of their two-factor authentication.
First you need your username and password. A physical token is then required to log in to the account. It’s a small card with many numbers that will be sent to your home by post. You’ve got to activate this card and use it whenever you log in.
In addition, you’ll prefer to encrypt the connections using standard SSL encryption.
Admittedly, keeping track of the physical token and using it whenever can be a bit of a hassle. But it should prevent hackers from gaining access to your account though they got your username and password.
Conclusion about Interactive Brokers in Canada
It can’t be avoided that the IB comes up with a breathtaking minimum deposit of $ 10,000 and high inactivity fees. As a result, it’s going to not be shortlisted for novice and casual Canadian traders alike. Aside from that, the corporate facilitates truly global trading and promises extremely low commissions and tight spreads. Not to mention, you’ll easily switch between Forex, Futures, Options, and CFDs from one screen while using the powerful, bespoke trading platform.
So overall, IB is arguably best suited for experienced traders with significant capital.